YouSaid · the spoken record

Matt Brown

lines on the record: 66
first: 2021-10-11
most recent: 2021-10-11
sittings or episodes: 1
sources: podcast

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“Blank canvas, everyone has a history and a story. Understand what it is, and you'll understand the person, and that will allow you to form a better relationship.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“I think the life lesson that I've learned is that everyone has a story, that everyone has had tough times, whether it's the loss of a parent or a tough time in business or whatever illness, everyone has a story. And that informs and makes up who they are. And I think that if I would have been a little more understood a little more about that concept, I think empathy would have played probably a bigger role in my life and in business, in my 20s and 30s. I know that's probably something a little bit difficult to do at that age, but looking now, I'm 52 years old. I think that if I knew a bit more that everyone has a story and to want to have the interest to learn about it, I think that would have served me a little better, starting off of my career. So my advice to those starting off in their careers, that when you meet someone, they're not just”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“My mother was very much an artist, had her PhD in art history. I grew up with a lot of the art world around me was probably one reason why I went and got a liberal arts education, philosophy, history, the arts. The ability to bring creativity into every equation, whether it's finance, which is traditionally not an area that people think about creativity, was tremendous. I mean, I can remember that in my early years in every aspect of school, it was always about thinking a little more left brain than right brain. Can't thank them enough for that. I don't think on my own I would have been naturally drawn to the world of the arts and the creative side, but that was a real lesson to learn there and valued.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“And the $20 million investment that I was unable to make in Apple at that time is now worth $15 billion. So lesson learned, always do a fair deal, even if you think you're in the driver's seat, never take advantage of a situation. I was young, and boy, that one stung. I may not be on this podcast by this point if that would have happened. Surely a lesson learned.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“That is the easiest one and the one that I will regret to my dying day. In the late 90s, one of my companies that I started invested in technology and healthcare companies and this small struggling technology company needed a $20 million cash infusion. It was a public company but wanted a private placement to get over some rough times. We negotiated. I was young in my 20s. I felt probably a little too full of myself thinking that we were in the driver's seat in the negotiation. I think I asked for too much and the deal did not happen. That technology company on Silicon Valley was called Apple.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“If I didn't have such a strong partner and my wife running our family day to day, I would be drawn to being more active in the family, which would take away the time needed to build a successful company. I really view my wife in a lot of different lights, but partnership is one of them, and she's been an amazing partner. And her commitment to our family has allowed me to build our business. And then I'll just say a comment on partnership overall. Nothing that's built is built alone. You have to have great partners. I've been very fortunate along the journey of case and other businesses, but especially, you know, CASE to have outstanding partners. I'm not going to name them all, but you'll know who you are. And I can't thank you enough because we all can't do everything. I have as many weaknesses as strengths and I need people to fill in the blanks.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“So the two people that have had the biggest impact in the business community, I was fortunate enough to have a friendship with Steve Schwartzmann, still do. Steve has, I would say, a mentor would be the wrong term because that would require us to spend time together, but through his books and through the conversations that we've been able to have, observing him Bill Blackstone, he's been a tremendous influence. I just very much admire the company he is. admire the integrity by which he approaches the business. Steve, as an individual, as a business leader, leader of a company has done just an outstanding job. I've been very fortunate to be able to talk to him about some of those things. The second one, and I'm not saying this just in case you listen.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“So my biggest pet peeve, whether it's personal or business or any aspect of my life, are the professional critics, the individuals that are not in the arena but are always firing off shots against those who are trying to do things. And we all know who they are. So I often say, you know, challenge us, criticize, say whatever you want, but come join us for a while. Get a little dirty in the trenches of building a business and being an entrepreneur. Don't just sit in the stands and heckle because it doesn't make anyone look good. So my biggest pet peeve would be just the critics don't play”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, just I try to get back as soon as I can. I find little windows of time. I put little blocks on my calendar. Also in the pre-COVID world and now actually starting again commuting is a great moment for that. If you're in a car or a train, make sure it has Wi-Fi. My plane rides now become great email inbox cleaner uppers. I do find the time, but I rarely go to bed at night with an unread message.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“Start every day with an espresso and end every day with a clean inbox. I think it's very important on the ladder for me anyway to know that I've closed out each day, even on weekends with an empty inbox so I can start the next day at least clean. Doesn't mean I've accomplished everything, but every message read, all of them responded to if possible so I can just don't get overwhelmed by email, which we all can do very, very quickly.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“Does not leave a lot of time, Ted, outside of working family. Tennis, both playing tennis and watching tennis, that's probably number one. And my great escape when I really want to unplug is movies. That's my go-to just when I want a two hour of just blocking it all out. And movies of all types. I don't focus on a genre. Braveheart and Casablanca score equally high in my world.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“Put their hat in the ring and try to compete, and that's what's going to make this great because you want people to come in with a more innovation, different ideas to try to upset the status quo. Today, however, we're a little bit standing alone. There's one or two other very high quality firms out there that we think are going to do great. But it's again back to my earlier comment. It's not so much about our competition today. It's about changing the behavior of an untapped marketplace.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“We look a lot bigger. I actually think we're doing a lot of what we're doing now, but we're just doing it better. I hammer the table that distraction oftentimes is the biggest enemy of growth. We don't have to do a lot different to continue to be growing at the pace that we're growing and be enormous. I think that this market has like all areas of Wall Street, a handful of winners. When I look at just the wealth ecosystem, I look at the custodians. There are three or four and more coming along the way. You know, we had the fidelities, the Schwabs and the Persians all competing against each other. And now Goldman Sachs wants to be a custodian for RIA assets. I look at the turnkey asset management platforms. You know, you have the asset marks and the invest nets and the brinkers and many more coming each day. It's not going to surprise me to see a handful of platforms sprout up and there'll be a handful of winners. And then every day, every week, every year.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“We have yet to find anyone yet that's done that, but we're constantly scouring the universe or just pure innovation. We need to be looking at technologies that are going to not make the old way better, but just change to a new way. I always joke, and I've said this a few times in conferences on panels, if you and I can get on an airplane with a TSA number, that somehow convinces everyone that we're not bad people just by applying one time. It seems a little archaic that you have to send in a photocopy of your driver's license to invest in a Blackstone fund. So things are probably going to change in that category. I think that there's going to be innovation there. It's going to get a heck of a lot easier for an individual to verify their net worth than going through a lot of paperwork and photocopying of documents. Those days are soon coming to an end.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, back to your question on loyalty, what other platforms are out there that advisors spend time with? There are many. There are many platforms that are fighting for the loyalty or the eyeballs of financial advisors. So one natural adjacency or partnership or acquisition will come in the community of firms that are currently working with financial advisors and are doing well. You can call that a customer acquisition strategy. You could call that a complementary services acquisition strategy, but depending on how you look at it, it's accelerating growth through like-minded platforms. That's definitely one area. Second area is that technology is moving at light speed. There's no reason why we shouldn't be acquirers of other businesses in technology. Maybe they're solving the mousetrap of the digitization business better than we are or in a different way than we are. We're always open.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“Keep every option on the table. But it started with getting our core promise correct. Many firms, I believe, want to grow too quickly or maybe grow through acquisition at the sacrifice of possibly their core promise. So we've stayed very focused. And now I think we're in a spot where that machine is doing quite well and we're ready to take a look at other opportunities.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“So there's organic growth, there's inorganic growth, there's a time and place for both. Often there's a time and place for both the same time. There are different verticals of the business or adjacent businesses that you can grow into. We really wanted to make sure that our core promise to our core community we delivered on. And that was independent advisors getting access to the best alternative investment funds in an environment that they trusted. We've spent at least to date our time, dollars, resources, making sure that we're delivering on that. And I think we've been rewarded for that. But as we evolve and grow, no secret, we recently made an announcement that we are taking a look at acquisitions now, partnerships, adjacencies to the business. And, you know, we are open for business in terms of scaling and organically. And I think that in this fast moving fintech community, we have to be willing to”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“Opportunity really is core to the success of our business. But look, it takes time. As an individual, myself, as a leader of the business, you have to have complete confidence in your ability to win and be willing to do everything to do it. I still work seven days a week. Well, in the old days, you used to go to the office on the weekends. Now I go to my home office on the weekends. Rarely a day goes by that I'm not working. It's just an unwavering commitment to be the best you can be and surround yourself by the best that you can get.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“good. We really are looking for the men and women who are what we call the case culture fit. These are the individuals that can come into the firm, make a mark, who want to grow, who want to learn, who understand what it means to be internally in a competitive entrepreneurial environment, thrive off of that, and always know, and our promise back to them is that if they continue to grow and rise, we will clear the path for them to grow and rise. Inside of case, we have just dozens and dozens of examples of individuals, men and women who have come at relatively young ages in more entry-level positions that over time have taken on more responsibility and have found themselves in very senior positions of the firm. So we are a firm that rewards success. So giving that opportunity and communicating, this is a place where you can get that.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“Leading a business is something that takes time to really learn. No one's born day one or shows up when they're 20, ready to run a company. It does take trial and error. Some of the lessons that I've taken with me, and this has been repeated so many different times by different business leaders, is that you really have to, I'm not going to say be comfortable with failure, but you have to really dig in when you do fail or you don't succeed and be willing to do the hard work to figure out why. And did you really put yourself in a position to win to begin with? So as we think about that as a cornerstone of the business, where can we compete successfully? Where should we not be competing? It's just not worth it. So that allocation and expectation management is quite critical. I think on the people side, there's been a lot of lessons learned over time in terms of people. Well, still a relatively small business, but when you think about adding hundreds of people in a short period of time, which is what we're doing, you really have to have a few things go very right. And the number one thing is the culture piece. In our interview process has gotten quite”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“I think that if you were a seasoned allocator to alternatives and you hadn't thought too much about the wealth management channel, I think you would be blown away by the size and scale of the potential of unallocated dollars to alternative investments. It's staggering. It's trillions of dollars that are currently in process of transition away from, let's call it the ETF mutual fund land into the alternative space broadly. Whether that's hedge funds, private equity, private credit, real estate strategies, crypto strategies, all things alternatives. It is a wall of capital. And I think if I'm an allocator, I would want to know what that means to me, impact that could have on the firms and the funds and the strategies that I'm currently working with or contemplating working with, and knowing that that capital is coming, I think that I would be able to position and select strategies that may be the beneficiaries of that.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“you're smart, you can be quite smart and choose a different path in life and be very capable of investing in a real estate fund or a private equity fund. So all the trends are pointing in the right direction, but it has to be done right and it has to be done with the right belts and suspenders for an experience, for a financial advisor and their end client that is thoughtful, safe, and has a positive outcome. And that's why education due diligence frameworks, high quality product access are really the keys.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“It seems to be very much where we are, that the trends of the growth of independent wealth management, the trends of the desire of alternative asset managers to get into wealth management, and the rise of fintech, which are our three areas, the trends are very strong in all three. Then you overlay the regulatory environment where the SEC is looking at ways to even improve democratization of financial products, but do it in a way that is controlled. do it in a way that is responsible. They don't want the Wild West. They want an environment where all investors have an equal opportunity to succeed. And that's a big theme. You're seeing that they're modifying some of the accreditation rules of who can invest in these products and asset management firms, not just based on a net worth, but based on an educational degree, the thesis there being just because you're wealthy doesn't mean”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“imaginable aspects that you would think would be true to that platform. But we also have a very sophisticated team in the field regionally that meet with financial advisors, speak to financial advisors, and make sure that we couple the more tech experience with more of a concierge experience. And when you blend those two together, that's the language that a financial advisor understands and knows. Maybe in 20 years from now, the next generation of financial advisors won't want to talk to anyone ever. That could happen. I think we're seeing some of that already bear out now. The younger generations do believe that why would I ever talk to a human and get advice when I can get advice from an algorithm and a computer? But we're not there yet.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“It's a really important topic engagement overall, maintaining the loyalty to the platform is something that we think a lot about and our tech and marketing teams and digital marketing teams think a lot about. There's Facebook's scary technology data, but they're watching everything. You click on something and then they only double down on that type of a topic or that content with you. That's not the case platform. So the way we view loyalty is really understanding who our client is and we really have two clients. We have the asset manager and we have the financial advisor. We know the average age of a financial advisor is typically in their 50s. They didn't grow up with Robin Hood or E-Trade or any of these technology platforms or financial engine platforms. A lot of their businesses were built on trust face to face. So our approach has always been one of coupling the human element with the technology element. So we have a technology platform and all the”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“Curious with all of the technology platforms that we all interact with, there's a lot of research that's gone into how those platforms gather the attention for better for worse for us, as I think about the case platform from a financial advisor's perspective. How do you think about their repeat use and their engagement with the platform?”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“Advisor. We also know that certain products in our platform are very much easier to access, easier to understand, have a more broad appeal if you think about it, the corn satellite approach. You probably are not going to start with a satellite strategy on a day one advisor, but more of a core strategy, more of an evergreen product. That data comes proven again and again. We know which advisors are making their transaction.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“If you're a first-time user of alternatives, that's obviously often the most difficult for the case platform in terms of just time and investment, but it's something we do every single day and we're committed to it. And frankly, we feel that's just part of the mission here. You have to have a willing advisor that feels comfortable explaining alternative investment strategies to their end client. As a former financial advisor, I just know our industry doesn't talk about things to their end client that they don't understand. So for example, we're all at dinner and the conversation of blockchain or crypto starts, you know, there's certain people at the table that just don't participate in that conversation. They just don't know what the facts are. They feel uncomfortable. Well, if you're a financial advisor and you don't have a command of at least a basic understanding of alternative investments, you avoid it. So our ability to use scalable technology to educate, to arm the advisor to be able to have the conversation is critical. So that's where we start with the.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“Are you finding the bottlenecks of that educational curve from someone, say, a financial advisor, an independent financial advisor who hasn't used alternatives to where do they get started and then where do they go in terms of the different investment strategies on the platform?”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“We would see a handful of things. Early requests for content on strategies on our learning platform. I'll just use the flavor of the week or the year crypto, for example. Who was thinking about crypto last year or the year before as a place to potentially invest? Now, crypto, interestingly, just as a category has the highest level of engagement and interest in learning and probably the lowest level of investment probably doesn't surprise you. More people are interested to know what's going on in this space, but it has the fewest bets so far on a relative basis compared to the amount of education that's happening. And then in turn, what we do is we get behind thematics like that on the platform. Our research team can then begin to put together content around it. We can leverage our partner Mercer. We can start to build the menu of funds and products and make them accessible and have that entire offering come to life at the right time.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“And then the broad middle tends to follow. So insights like that allow us to really consult with them. We use a lot of peer group conversations around where the puck is going. And that informs our menu, our product structuring, our asset manager selection. So it's a very collaborative experience.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“If you looked at a heat map or a flowchart over the past three or four years and you kind of bucketed it between hedge fund strategies, private equity, private credit, and real estate, let's be kind of bold around four corners there. Every year there's a different winner. And every year the allocation rates oddly are around the same, but in just different categories. So what we're seeing is this rotation, if you will, of dollars based on certain trends or macro environment that we're looking at right now. What I do find to be some of the most fascinating data that we do not publish or make available is that certain financial advisor firms are constantly ahead of the game and they're often right. So what we're able to see now on the platform is certain firms that are implementing ideas, solutions, suggestions, portfolio construction way ahead of the pack.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“The longer you're in business and the more volume that's processed across the platform, the more data we have and the more history it shows. It is extremely valuable. And the way we've been using it is really an understanding what financial advisors desire to be on the platform. It's a real early indicator of interest. Imagine if you and I ran a Whole Foods together and we actually had a scientific way of knowing what we should put on the shelves before they walk in the store. So the data is showing us where advisors are interested in, what areas or strategies they're interested in, how much time they're spending learning about different strategies or funds or products, which then informs us proactively to be able to constantly keep the menu of offerings on our platform fresh and current for them to be able to select.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“It's on the list. Some of the problems that case solves institutions don't face. So for example, institutions don't have thousands of documents they have to process to make an allocation to a fund because they're allocating from one pool. So it's one subscription document. That said, there are many things on the case platform that institutions can find value in, not the least of which is our content, not the least of which is the access to certain asset managers that are on our platform. The main event, however, may not be necessarily the ease of use of the subscription document, but there are many, many parts of the value chain that technology has modified, enhanced, or improved that they will find value in. So we're looking very seriously at how we can bring the case platform to the institutional world.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“As you grow the technology platform deeper into the financial advisor channel, I'm wondering if you've had conversations with the same type of technological issues for institutions in terms of the manual paper intensive way of processing subscription docs and the like.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“It really is a combination of a couple things. We find that where people learn, they actually transact. So if you're reaching out and learning about something and you have an opportunity to follow through on that learning experience with an action, in this case an investment coupling those two are. information around alternatives to an advisor and then mirroring that in the same location of transacting it's a very powerful combination.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“kind of competition that case may have. A competitor, for example, or other competitive forces. The main event is capturing the hearts and minds of the financial advisor to stop doing business the old fashioned way, which is find their own funds, use paperwork to execute it very manual to operating on a platform. And so that's how we're thinking about that, really improving the overall experience to the point where it changes behavior.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“There's a challenge every day. It can be an internal challenge as a young company trying to grow a great team. There's always cycles of growing pains. In the last six months, we've doubled the size of the firm and we're about to then double over the next 12 months the resources that we need in technology, marketing, on the investment side and the platform management side. So straight down the middle, young company growing pains. Other challenges, convincing anyone to do something new is hard. So when Amazon started, they probably didn't have too hard of a time, but what were they doing? They were trying to convince UTED not to go down to the local store to buy something, but to use their platform to do it instead, even though their store could have been just a mile away. Uber is trying to reinvent the way we think about taking a taxi or transportation. Airbnb, the same thing. So anything that's disruptive, you need to win the loyalty of the audience on both sides of your marketplace. So really the big challenge isn't any.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“It's had a big impact. The biggest is product innovation. There are many well-known institutional alternative asset managers who have now really reoriented their entire businesses around the wealth channel and the high net worth channel. Blackstone, of course, being one Carlisle being another KKR, but it's not limited just to the brand names. The multi-trillion dollar opportunity, which is the allocation opportunity in independent wealth, is a bit of a wild west. It's an area where it's not fully allocated, as I mentioned. So the firms that are investing today in technology and product innovation, meaning structures that are more easily and readily available for financial advisors to invest through, are going to be the winners. And certain asset managers are making great strides today.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“Allocation rates across the board. They diversify across with many different funds and products. At the end of the day, this is about improving outcomes for the end clients. And alternative investments have been doing their job. The next level here that we're seeing is somewhat of the kind of displacement of what we would call traditional active management. Many believe that active management is not delivered and that alternative investments are really the new active and delivering the alpha that the advisor and therefore their end client really want.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“RIA channel and the regional and broker dealer channel has been just booming. The growth just in AUM is substantial even since when we started the platform business. More RIAs are developing. There's consolidation in the space wirehouse advisors like the JPMorgan example I gave you. Many are leaving and building their own RIAs. So just as an overall total addressable market, it's growing and quite substantial. What's interesting though, however, and where the opportunity is, is that the RA channel has allocation rates to alternative investments less than 2%. Their colleagues in the larger wealth management firms, the wirehouses, on average have allocation rates between 10 and 15%. That's primarily due to the platform business. It's embedded in those big firms are the platforms that bring the ease of use, the product access, the due diligence framework. So we see that RIAs that work with CASE instantly increase their alternative.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“I want to turn a little bit to this private wealth channel as a whole. This seems like in the last 10 years you said from very little if you're not one a JPMorgan platform to something very substantial, what are you seeing in terms of asset allocation at that financial advisor level and where this is all headed?”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“Big topic without a doubt. So, just in terms of sheer numbers, our model has always been one of really trying to bring the top in each category to the community of investors and advisors. We don't need 25 long short managers or 25 growth equity managers, but two, three or four of the top, so there's selection. And that's a business model that served us quite well. Our approach to manager selection from a commercial standpoint takes us down one path, but in complete parallel is the relationship that we established on day one at CASE with Mercer, the global leader in operational due diligence, investment due diligence as a 300-person due diligence team globally analyzes and due diligences thousands of funds per year. So in order for a fund to be the case platform, in addition to the commercial aspects of joining the platform, they have to independently go through and successfully pass mercers investment in operational due diligence.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“So, as you look at today, where you've amassed billions of dollars on the platform, you have to think more and more managers would be interested in accessing that. I'm curious on the case side, how do you think about due diligence and manager selection of the next incremental manager on the platform?”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“So the AML KYC suitability, that entire workflow is done in partnership with the advisor on the case platform. And then the asset manager overlays with whatever checks and balances they feel they need to do as well. So that's a big piece of what our platform does is to make sure that the investors, the end investors are meeting the criteria of the underlying asset management firm.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“You mentioned the accreditor status. And I guess in that onboarding, the financial advisor's client can just check the box, what has to happen for the manager to understand that individual client of the financial advisor is credited and eligible to invest in their fund?”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“It depends on what they prefer. More and more managers are actually interested to have end investors directly into their funds. They themselves have made the commitment, the asset managers, to go after the wealth channel and see if they can grow their shareholder base and diversify it. And part of that is to make sure that they have a business or a platform that can accept smaller investors. Now, there's smaller in check size, but they're not smaller in the net worth requirements that are still required to go into these products. And we can talk about accreditation in a second. So yes, many do prefer that. They can create different funds and vehicles to be able to accommodate that. Those investors can go directly into the fund. The other side is those who don't prefer that, and we have the ability to bundle those investors in somewhat of an omnibus way at the case level and deliver that as a single investor. Really, we allow the asset manager to decide which way they want to have the investors approach their fund.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“All those fragmented dots. So really what we're doing is we're transforming alternative investing. than alternative investing.”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“So, financial advisor, when they come into the platform, they are instantly coming into a user experience that is seamless. It's an enjoyable experience. There's moments of learning and investigation on different funds and products. When they actually want to select a fund one or more to invest in, their end client information is already in our system. So what they're doing is they're finding the fund or funds on our platform. literally clicking the names of their end clients and therefore an auto population of information happens onto the subscription document and then that sets off a workflow for purchase between the various members of the ecosystem that make fun purchasing happen the fund administrator is a player in that of course the custodians that hold capital are also so we send out of course the reporting and execution information that can”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source
“I'm really curious how this works on both sides. So let's start with the financial advisor side from a technological perspective. Anyone who's investing in funds knows the burden of filling out all the right paperwork and getting everything done. And it tends to be done in a really nanolog way today. What does that look like on the platform for a financial advisor?”
2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source